Valuation of Te Ohu Kaimoana held income shares in Aotearoa Fisheries Limited

We are pleased to provide you with the independent valuation commissioned to assess the value of the income shares held by Te Ohu Kaimoana in Aotearoa Fisheries Limited (AFL), trading as Moana New Zealand.

As well as a copy of the valuation, we aim to provide you with:

• Background, context and methodology of the valuation
• Information about the Redeemable Preference shares (RPS) transaction, required by legislation and discussed below, which will result in Te Ohu Kaimoana acquiring an additional income share in AFL
• How this valuation should be used
• Contact details for questions

The purpose of this valuation exercise is to also provide information to assist iwi to determine the carrying value of their AFL income shares to meet new accounting standard IPSAS PBE 41 Financial Instruments.  

We appreciate that much of this information is quite technical in nature, and encourage discussion with your finance teams and/or accountants. As mentioned above, you will also find the relevant contact details for Te Ohu Kaimoana at the bottom of this pānui.

Context and background

PricewaterhouseCoopers International Limited (PwC) were engaged to value Te Ohu Kaimoana’s shares in AFL.

The valuation took a ‘sum of the parts’ approach to estimating fair market value, primarily using capitalisation of earnings for each ‘part’. This involved separate consideration of AFL’s core operations in addition to investment in joint ventures and associates (including Sealord Group Limited).

There are two conclusions reported in the valuation:

• the position at 30 September 2024 for the purposes of our year-end financial statements; and
• the pro-forma valuation post exchange of the RPS, which took place after balance date.

Access to the valuation report

Please be advised that this valuation is only available to representatives from Mandated and Recognised Iwi Organisations and their Asset Holding Companies (as defined under the Maori Fisheries Act 2004).

To request access to the valution, please email: ika@teohukaimoana.nz

Redeemable Preference Shares (RPS)

Te Ohu Kaimoana holds RPS in Aotearoa Fisheries Limited Investments Limited; a wholly owned subsidiary of AFL.

In accordance with the Māori Fisheries Amendment Act 2024, Te Ohu Kaimoana must sell the $20m RPS to AFL and, in exchange, AFL must issue income shares to Te Ohu Kaimoana. This will occur as part of a broader change to the shareholding of AFL where:

• Voting shares in AFL (currently held by Te Ohu Kaimoana) will be cancelled.
• Income shares in AFL will convert to ordinary shares. This includes both the existing ordinary shares held by Te Ohu Kaimoana (20%) and iwi shareholders (80%); plus the income shares Te Ohu Kaimoana will receive in exchange for the RPS.
• Te Ohu Kaimoana will allocate and distribute its ordinary shares proportionately (by population) amongst the iwi shareholders.

Te Ohu Kaimoana and AFL have agreed to exchange the RPS for a single income share. This RPS exchange transaction will occur in January 2025. The broader transaction steps will occur by26 July 2026, and Te Ohu Kaimoana will provide further information on this a sit draws nearer.  

For accounting purposes AFL has historically recorded the RPS as a liability on its balance sheet, so exchanging the RPS for an income share results in a reduction to AFL’s liabilities and an increase to its equity and shareholder value p/share.

Further valuation information and guidance

This valuation provides a benchmark for iwi to use when assessing the values of their settlement assets for financial reporting purposes, and in particular to meet the reporting requirement of IPSAS PBE 41 Financial Instruments.

Each iwi need to make their own assessment of the carrying value of their AFL shares and seek their own advice. This valuation would be just one of the pieces of information taken into account in that assessment.

We intend to conduct a further review of the valuation prior to July 2026.

If you have any questions about the information above, please contact Bede Dwyer via email at: bede.dwyer@teohukaimoana.nz

Please note that the offices of Te Ohu Kaimoana will be closed from Monday 23 December and reopen on Monday 6 January, so while we invite queries regarding AFL shares in the interim, we will not be able to address those queries until the new year.